By Amelia Isaacs on Friday 24 March 2023
The organisation laid out its parting advice to the tech sector to ensure the UK remains a big player on the global stage.
After a decade of supporting the UK’s startup sector, Tech Nation announced in January it will close at the end of March.
The decision came after it lost its government grant to Barclays, with the organisation saying a lot of its work was “not viable” without the financial support.
Tech Nation has supported more than 5,000 companies, contributed £600m of gross value add to the economy since 2014, and its alumni, which include Revolut, Wise and Monzo, have raised £28.1bn, had 13 IPOs and make up 40 per cent of all tech unicorns and decacorns in the UK.
Ahead of shutting down next week, Tech Nation has released its final report, calling for tangible help for the UK tech sector to accelerate growth over the next decade.
Predicting that the UK tech ecosystem will reach $2.6 trillion by 2032 — up from $1 trillion in 2022 — if the rate of growth is maintained, it said that a $4 trillion ecosystem is “within reach” if better conditions for scaling are created.
Tech Nation called for this to be the target the ecosystem collectively aims for to maintain the UK’s strength on the global tech stage.
“The last decade of UK tech has been an incredible success story. One in which the UK is now third in the world for tech investment, after the US and China,” TechNation CEO Gerard Grech said.
“But there is much more we can do and value to be unlocked if we create the right conditions for future growth over the coming years, as this report shows.
“We urge ecosystem stakeholders, investors and government to continue optimising the business environment for tech businesses, from opening up new pathways for talent to increasing sources of funding.”
The report outlined three main goals it recommends to make this a reality: addressing access to finance, boosting diversity and prioritising value realisation.
It said that 15x investment in deep tech and climate tech will have to be made by the end of the decade to stimulate and sustain growth, while addressing gaps in access to finance for both startups and scaleups count add an extra $450bn in value to the tech ecosystem over the next decade.
The 2023 report also called for companies to rethink talent gaps, saying an extra $400bn in value could be added if inequalities in access to opportunities for underrepresented communities are reduced.
Finally, an extra $550bn in additional value could be created if tech leaders in the UK develop “a Silicon-valley like sense of exit intentionality”, the report said, if capital and talent are “efficiently recycled” through the ecosystem, knowledge is deepened and shared and high-value exits are enabled.
“The last decade of UK tech has been explosive; growth has been unprecedented, and the positive economic impact created by founders has been almost unimaginable,” Tech Nation data and research director Dr George Windsor said.
“As UK tech continues to mature, we must take every opportunity we can to collectively re-imagine, and change ecosystem conditions for the better.”
Investment dropped by 32 per cent globally and by 28 per cent in the UK last year, and while UK startups raised 72 per cent more in 2022 ($30bn) than they did in 2020, this was still down from the heights of 2021.
The UK took back its position as the third largest tech ecosystem in the world after falling behind India and still remains the dominant player in Europe, however, the report indicated that without the right conditions and support mechanisms, there is a risk it will be caught up.
“Tech is at an inflection point, with a profound opportunity for future growth, and a number of both headwinds and tailwinds to get there,” Windsor added.
“Let us continue to build this Tech Nation together; thoughtfully, for everyone, and for our future.”
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